Everything (and We Mean Everything) You Need to Know About Obamacare

We're not even a week in, and 2014 is already off to a strong start. We've got tons of things to shop for, music to look forward to, and cool girls to admire. Also happening this year? The rollout of Obamacare.

First let's get the terminology straight. Obamacare is another term for the very official sounding Patient Protection and Affordable Care Act, which provides Americans with wider access to much-needed health insurance—which is a really big deal for you and your friends (i.e. people ages 18 to 26-ish). Rejection of coverage due to preexisting conditions is about to become a thing of the past, girls won't be able to be charged more than guys (yup, that's a thing that used to happen), and you can expect a big improvement in women's health services.

All good things, but where do you even begin? Well, we laid it all out for you below, and YES, there is a deadline (complete with a tax penalty you'll incur for not having health insurance). So read carefully!

Do I need to enroll?

There are lots of reasons you might need healthcare coverage through Obamacare. Your parents don't have an insurance plan for you to tack onto (remember: the 2010 Affordable Care Act allowed for kids to remain on their parents' plan until the age of 26, even if they're eligible for employer-provided insurance or are married—nice right?); a college or university healthcare plan isn't an option (whether because of financial reasons or because you're no longer enrolled); you make too much to qualify for Medicaid; you're currently unemployed; or, like many of us out there, you're working on a freelance basis sans benefits.

There's also the possibility that your current insurance costs might be higher than what you'd pay through Obamacare, so it could be worth researching and doing the math to compare.

How does it all work?

You've probably heard by now—in the news, on social media, etc.—that this whole process can be a bit complicated, so you'll have to take it step by step.

Each state has it's own "marketplace" or "health exchange" where you can research, assess, and select which plan and insurance provider works best for you. The umbrella website to start your search is Healthcare.gov. From there, you'll enter in a few details (what type of insurance you're looking for, your zip code) and be directed to your specific state's site where you'll have to set up an account to get the ball rolling.

Things to note: Each state has a different name for their marketplace or exchange, so don't let that confuse you if you're talking to friends in other cities. Also, some states also offer dental insurance.

What plans are offered?

There are four tiers, each named for precious metals—with platinum being the most comprehensive, naturally. Here's the general breakdown:

Platinum pays out 90 percent or more of all healthcare costs with no deductible. The maximum annual out-of-pocket health costs you would have to pay top out at $2,000. Gold pays out 80 percent of all healthcare costs with a deductible of $600 and an annual out-of-pocket cap of $4,000. Silver pays out 70 percent of all healthcare costs with a deductible of $2,000 and an out-of-pocket cap of $5,500. Bronze covers 60 percent with a deductible of $3,000 and an out-of-pocket cap of $6,350.

There's also the under-the-radar "catastrophic" plan. While a tad alarmist-sounding, "catastrophic" is what they call the lowest-costing plan, and it's actually aimed at people aged 30 or under. (Although, real talk, people over 30 can apply for eligibility, too.) The plan is pretty no frills, offering 50 percent coverage, including three primary care visits, with a $6,350 deductible.

Advertisement

But how much will it actually cost me?

Well, it depends. In order to assess your monthly premium, a number of variables are involved: your age, state, number of enrollees, and whether or not you smoke (another reason not to, right?). Once you set up your account on your state's exchange, you can start pricing out your plan based on your needs and background.

According to Reuters, the average premium for a mid-tier plan is $328 a month, but the cost could vary considerably depending on where you live. For instance, a lower-priced plan in Minnesota is said to cost $108 per month, while New York Magazine reports bronze coverage will run around $308 for New York state residents.

What if I can't afford the insurance?

Depending on your state and income, you could be eligible for Medicaid coverage. There are also subsidies and financial aid to help you lower your monthly payments (as well as additional out-of-pocket expenses and deductibles), so don't fret quite yet. To calculate any cost breaks you might be able to get, go to your state's healthcare marketplace or try the Kaiser Family Foundation's subsidy calculator. Just be careful you don't over-estimate because you might have to pay the amount back later on!

When do I need to enroll by?

Open enrollment in the healthcare marketplace began back in October, but you still have until March 31, 2014 to enroll for coverage for this year and avoid paying that penalty fee (more on that in a bit). If you enroll in the first half of January (through January 15), you'll be covered as of February 1, once you make your first premium payment. If you enroll during the second half of the month—January 16 or after—then you're covered as of March 1, once you pay your first premium. This pattern continues up through March 31.

Important: Make sure you know your first monthly premium deadline! As of now, the January deadline has been extended to January 10. After March 31, the next open enrollment period (for 2015) won't begin until November 15, and you'll have to pay a fine for not having coverage this year.

What is this penalty fine?!

When you file your 2014 tax returns, you'll have to prove that you have health insurance, which you need to enroll for by March 31, 2014. (Seriously, remember this date!) If you don't, the penalties work like this: For no coverage in 2014, you'll be fined $95 or 1 percent of your taxable income—whichever is higher. In 2015, the fine goes up to $325 or 2 percent of your taxable income. Then in 2016, the penalty skyrockets to $695 or 2.5 percent of your taxable income.

From a pure numbers standpoint, a $95 penalty may seem more attractive than paying out hundreds in monthly premiums, but don't be shortsighted. We're talking about your health and you never know what can happen! Plus, 2015 will be here faster than you think.

This is still really confusing—I need a real live person to help me.

Just writing this breakdown involved an avalanche of information to filter through, so we feel you, we really do. But thankfully, there are customer service resources to help walk you through it all! There's a general Healthcare.gov hotline you can reach by calling 1-800-318-2596 and also an online live chat function which is available 24 hours a day, seven days a week. (We waited about five minutes to chat, which isn't so bad).

Each state's individual health exchanges will also have their own agencies that can help you out over the phone or in person. You can search on the Healthcare.gov homepage to be directed to agencies near you. We also tried a Google search for hometown, state, and the term "in-person assisters" (the official government term) to find more specific info. For instance, Washington State's are found here and New York's here.

Advertisement

And one more thing...

Aside from the benefits of, you know, having health insurance in case of emergency (or just to take care of your basic but necessary healthcare needs!), enrolling in Obamacare actually benefits everyone looking for affordable coverage. You may have heard how the powers that be are concerned that not enough Millennials are jumping on the Obamacare train, and that concern is valid. If the marketplaces don't have enough young, healthy types to offset the costs of the more medically needy, then insurers might opt out of providing coverage the next year. In order for diverse and comprehensive coverage options to exist, Obamacare needs a balanced mix of participants—meaning you. Just another reason to get moving by the March 31 deadline!